Word from Washington: July 2023

July saw mounting coverage losses from the national Medicaid unwinding. As of July 28, nearly four million people have been disenrolled from Medicaid since redeterminations began in April 2023. Three-quarters of that total lost coverage for procedural reasons, i.e., paperwork, and may still be eligible for Medicaid. In response to this dismaying track record: 

  • At least nine states have paused procedural terminations in order to revamp their processes: DE, ID, IA, ME, MN, MS, NY, WV, WY. (Some of the biggest states, including NY and CA, are at the earliest stage of unwinding, with no data yet reported; and OR doesn’t plan to start redeterminations until October 1).  
  • The U.S. Centers for Medicare and Medicaid Services (CMS) has approved mitigation plans for a total of 35 states to come into compliance with federal requirements designed to protect eligible beneficiaries from unwarranted terminations. One such requirement: using third-party data sources to confirm a beneficiary’s eligibility, without subjecting the beneficiary to unnecessary paperwork. 
  • The Biden Administration asked employers to give workers who lose Medicaid coverage additional time (beyond the traditional 60 days) to sign up for health insurance offered through their workplace. 
  • The U.S. Federal Trade Commission (FTC) reminded Medicaid beneficiaries to beware of scams that target individuals who have to re-enroll. Medicaid will never ask for payment to renew an individual’s coverage. People no longer eligible for Medicaid coverage can avoid being duped into junk plans by starting their insurance searches at HealthCare.gov.   

Also in July, CMS released its first set of official data on Medicaid unwinding. The CMS report covers only 18 states that had completed one round of Medicaid redeterminations as of April 30. Even that limited dataset showed coverage losses for over 700,000 people—80% of which were due to procedural reasons. HFA and 34 other patient advocacy groups responded to the data release, urging CMS to use its full enforcement authority to protect Medicaid beneficiaries’ coverage, and calling on CMS to post more detailed and timelier data about state unwinding activities.  

Quick Hits

  • The U.S. Departments of Health and Human Services (HHS), Treasury, and Labor published a proposed rule re-imposing limits on short-term health plans. (Short-term health plans do not have to meet Affordable Care Act standards for coverage and financial protection and therefore do not provide adequate coverage for people living with health conditions such as a bleeding disorder.) HFA and 36 other patient advocacy groups issued a statement applauding the issuance of the proposed rule, which would protect consumers against substandard forms of coverage while returning short-term health plans to their original purpose as a temporary backstop. 
  • Medicaid managed care plans frequently deny prior authorization requests for treatments and services, according to a July report from the HHS Office of the Inspector General. The report further finds that state and federal officials exercise little oversight of these denials (which vary from state to state and carrier to carrier, but on average affect one in eight coverage requests).   
  • House and Senate committees marked up a slew of health bills over the course of July, on topics ranging from pandemic preparedness to opioid treatment to standalone telehealth plans and more. Of particular interest, multiple bills relating to oversight of pharmacy benefit managers (PBMs) moved through committees in both houses. The bills would mandate more transparency into PBM operations and (in some cases) would prohibit reimbursement arrangements that incentivize PBMs to recommend higher-cost drugs. Momentum for PBM reform also continues to build outside of Congress, with the FTC rescinding outdated guidance that shielded PBMs from federal oversight.  
  • HHS and Treasury, in conjunction with the U.S. Consumer Financial Protection Board, launched an inquiry into medical debt and collections practices. The agencies are particularly concerned by the proliferation of high-cost medical financing products, such as medical credit cards and installment loans used in connection with routine care. 
  • North Carolina Gov. Roy Cooper won CMS approval for his plan to move forward with the state’s Medicaid expansion on October 1.  It remains unclear, however, whether the NC legislature will approve the necessary funding in time to meet this deadline. 
  • Congress has left Washington for its August recess. This is a great time for advocates to schedule meetings with their federal legislators at their in-state offices. Follow HFA’s social media for some upcoming posts with tips about connecting with lawmakers over the August recess!